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Outlook for Central Texas better than most, says Angelou
Friday, January 25, 2008 by Austin Monitor
One of Austin’s leading economists is predicting continued growth for the Central Texas economy over the next two years, but not at the rate the region has experienced since the economic recovery four years ago. The Economic and Technology Forecast from Angelos Angelou says the region will continue to add jobs and population over the next two years.
“We expect total job creation in Austin to slow down, but it will not stop,” Angelou said. “As the national economy will be sorting out the sub-prime mortgage crisis and worries of an impending recession, the Austin metro area will take about a six or eight month breather. Angelou Economics predicts an increase of 17,000 jobs in 2008 and about 24,000 jobs in 2009. This is about a 2.3 and 3.2 percent growth, respectively.”
While many of those jobs will come in the government, retail, and professional services sectors, Angelou said the region was poised for significant growth in the clean energy sector. That potential is due in large part, he said, to the focus that local officials have placed on solar power, wind power, and biofuels.
“All of us are very proud of Austin Energy, in that they are the greenest utility in the nation. Accelerating the development of clean energy perfectly matches Austin’s persona,” Angelou said. “I think it will be a significant development if we can package many of our competitive advantages as well as assets by establishing an International Center for Energy Innovation and Security in Texas. I envision such a center to become a public-private sector partnership with a global reach to fund new research and to become a catalyst for new technologies and investments.”
Angelou said Austin’s housing market has already been affected by the problems in the sub-prime mortgage industry, but that the region’s growing population would likely spur demand that would help cushion the blow for Central Texas home builders. “We’re projecting further growth of more than 85,000 new residents in Austin the next two years,” he said. “People of Asian and Hispanic ethnicity are the fastest growing segments of Austin’s population, with the Asian population growing at nearly at 56 percent, and the Hispanic population growing by 40 percent since 2000.”
Although Angelou predicts the number of new home starts will drop, he also predicts the growing population and new mortgage restrictions will keep home prices fairly stable. That, in turn, will likely make it more difficult for many families to afford a home and keep apartment rental rates high.
As for the boom in downtown condos, Angelou said he did not believe the market for those high-end condominiums was being over-saturated. “There is strong demand. In fact, most of the questions are coming from people who are wishing for a price correction so they can jump in and buy a unit downtown,” he said, “which means the demand for downtown living is very strong.”
Several elected officials were in the audience for Angelou’s presentation at the Austin Convention Center, including Council Members Mike Martinez and Jennifer Kim. Angelou also recognized former Council Member Daryl Slusher, now with the Austin Water Utility, whom he said had been at each of his annual forecast briefings for the past 23 years.
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